How roadwork, raises factor into Utica's budget

Wednesday

That’s how long the Utica Common Council has to adopt a budget for the upcoming fiscal year.

Council members are working off a $72.5 million budget presented by Utica Mayor Robert Palmieri in February. The plan includes a 7.8 percent tax increase, but no job cuts.

“We’re lean, we’re mean and we’re effective, and you are having economic development,” Palmieri said. “You are having these buildings that were vacant up and running with millions of dollars being infused with it. Is there an opportunity for us to do better? Absolutely there is, and that’s what we’re trying to achieve at this point.”

Here are some questions coming out of the process so far:

How does the paving plan affect the budget?

A public referendum requires the city to invest at least $5 million annually in street paving. The plan has been to borrow half of each annual investment.

In the plan’s first year, the Common Council approved a bond anticipation note — which is a way to borrow money in anticipation of putting it into a bond — to borrow $2.5 million at a set interest rate.

Then a few months ago, the council — with advice from the city comptroller’s office — authorized bonding for last summer’s $2.5 million along with another $2.5 million to help cover this summer’s roadwork.

That, coupled with moves by the council to bond for pool and parking garage repairs last year, substantially increased debt payments, said Heather Mowat, Utica’s budget director, with $406,086 for paving.

“When they approved it, I don’t think they quite understood what the repayment plan was and I think that’s where some of this confusion comes in because the budget itself, the actual debt payments increase $1 million,” Mowat said. “Before we did anything else, the budget, if we kept everything the same as last year — it’s 3 percent (of the tax increase).”

How were certain raises calculated?

The city’s contract with the police union has been expired for more than a year now, and the city soon will enter into negotiations with the firefighters’ union and local CSEA, Palmieri said.

As such, Mowat said salaries for certain positions covered by expiring contracts were kept flat. She said any increases for union members with expired contracts are caused by either longevity increases, promotions or salary step increases.

The budget also includes a 4.5 percent cost-of-living adjustment for the mayor, comptroller, treasurer, Common Council president and council members. Any individuals eligible for adjustments can choose to pay it back at the end of the fiscal year.

Among the Finance Committee members — Chairman Joseph Marino, Co-Chairwoman Samantha Colosimo-Testa and Councilman Mark Williamson, R-at large — will all pay back their adjustments. Councilman Jack LoMedico could not be immediately reached for comment.

Palmieri plans to accept it, saying he is one of the lowest paid mayors in similarly sized cities across the state. His salary would increase from $77,015.10 to $80,480.78.

The tax cap limits the annual growth of property taxes levied by local governments without an override. That percentage typically is either 2 percent or the rate of inflation, whichever is lower, according to the state.

But since officials elected not to raise taxes last year, which resulted in taxes ultimately going down, this year’s cap is 3.7 percent, Mowat said. That means the city can levy just over $1 million in taxes without going over the cap.

The mayor’s budget increases the tax levy by more than $2.2 million, resulting in the 7.8 percent tax increase.

Comptroller William Morehouse said the cap was calculated through a formula provided by the state that took into account last year’s tax rate and the payments in lieu of taxes due to the city.

What does the Finance Committee make of the budget?

The Common Council approved an override of the cap, if needed, with a resolution last month.

Without getting into specific amendments, Colosimo-Testa, D-6, said she is evaluating potential reductions in areas without necessary costs along with new revenue streams, such as increased fees for city pools.

Marino, D-4, said he is confident the council can lower expenses below the cap.

“I always choose if we are in a situation where we need to cut, I always choose things over people,” he said. “If there are things that departments need that will not directly impact the people of the city, those are things that I look to first that we can cut … I’m not willing to cut labor. I’m willing to cut remodeling city hall and things like that.”

Williamson, R-at large, does not share his enthusiasm, saying there could be expenses the council could push to next year, but the result could be higher costs in the long run.

“I just don’t see it happening,” he said. “You’re talking $1.5 million to get to 2 percent, almost. What’s that going to come from?”

Contact reporter Greg Mason at 315-792-5074 or follow him on Twitter (@OD_Mason).

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